House likely not an inheritance
Ask a Lawyer
June 7, 2010Q My parents bought a house in the 1970s. After my father died, my mother remarried and added my stepfather's name to the deed.
After my mother died, my stepfather remarried and added his wife's name, along with mine, to the deed.
My stepparents, now in an assisted-living home, signed a quitclaim deed to give me the house. When I sell it, do I have to pay capital gains or is it considered an inheritance?
L.B.
ST. CLOUD
A Because your stepparents signed a quitclaim deed, you presumably already are the sole owner of the home and it likely would not be considered an inheritance. Generally speaking, that means you would have to pay capital gains when you sell it.
But how much tax you would have to pay, if any, will depend on a number of other issues and facts not described. The home has gone through a number of transfers, with probates likely involved, which could affect how capital gains are calculated.
You also could benefit from federal gift-tax exemptions of the donors. When gifting more than the annual exclusion to a person in a year, a gift-tax return must be filed. But as long as all gifts do not exceed the lifetime gift credit of $1 million, then no taxes may be owed. You should consult a tax professional with details for a definitive answer.
•Question answered by attorney Lawrence H. Kolin of Alvarez, Sambol & Winthrop, P.A.
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